SAP hoped for award of roughly $40 million, may appeal

JohnLetzing

At a trial held in Oakland, Calif., a jury awarded Oracle
ORCL, +0.73%
$1.3 billion as a result of the company’s claims that an SAP
SAP, +0.04%
subsidiary stole a significant amount of intellectual property used to provide cut-rate software support to Oracle customers — in a bid to lure those customers away to SAP.

SAP had acknowledged the wrongdoing by its now defunct subsidiary, TomorrowNow, though the German software giant had argued that damages should be more on the order of roughly $40 million.

Safra Catz, an Oracle co-president, said in a statement that the verdict is “the largest amount ever awarded for software piracy.”

“The trial made it clear that SAP’s most senior executives were aware of the illegal activity from the very beginning,” Catz said. Oracle filed suit in the dispute in early 2007.

During the roughly three-week trial, Oracle argued that top SAP executives had sought to use TomorrowNow to undermine Oracle’s $11 billion purchase of PeopleSoft in 2004, by drawing away PeopleSoft customers with the use of pilfered Oracle customer support documents.

Oracle said that as a result, damages were in the billions of dollars.

SAP countered that Oracle’s claims were “based on fantasy.” While SAP acknowledged that it should have kept a closer eye on TomorrowNow, it argued that the subsidiary was ultimately only able to siphon off a relatively small number of Oracle customers with its actions.

SAP had acquired TomorrowNow for just $10 million.

An SAP spokesman said in a statement, “We are, of course, disappointed by this verdict and will pursue all available options, including post-trial motions and appeal if necessary.”

The spokesman added, “This will unfortunately be a prolonged process and we continue to hope that the matter can be resolved appropriately without more years of litigation.”

Oracle’s charges caused a significant amount of embarrassment for Walldorf, Germany-based SAP, and for another of Oracle’s rivals: Hewlett-Packard Co.
HPQ, -0.33%

H-P’s newly appointed chief executive, Leo Apotheker, was a top executive at SAP during the period in which it bought TomorrowNow, and used it as part of the “Safe Passage” program intended to draw customers at companies acquired by Oracle, including PeopleSoft, over to SAP.

During the trial, Oracle attorneys presented an email written by Apotheker when he was at SAP, in which he expresses a desire to use TomorrowNow to “inflict some pain on Oracle.”

While Oracle sought to force Apotheker to testify at the trial, the Redwood Shores, Calif.-based company claimed that it was unable to locate him.

Apotheker, who started work at H-P just three weeks ago, addressed the press and analysts during H-P’s fourth-quarter earnings presentation on Monday.

Shares of Oracle rose more than 1% in after-hours trading, while U.S.-traded shares of SAP fell more than 1%.

Intraday Data provided by SIX Financial Information and subject to terms of use.
Historical and current end-of-day data provided by SIX Financial Information. Intraday data
delayed per exchange requirements. S&P/Dow Jones Indices (SM) from Dow Jones & Company, Inc.
All quotes are in local exchange time. Real time last sale data provided by NASDAQ. More
information on NASDAQ traded symbols and their current financial status. Intraday
data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges. S&P/Dow Jones Indices (SM)
from Dow Jones & Company, Inc. SEHK intraday data is provided by SIX Financial Information and is
at least 60-minutes delayed. All quotes are in local exchange time.